This Week in Startups - E1003: The Athletic CEO & Co-founder Alex Mather is building a paid online sports media publication, shares insights on attracting investors in a seemingly dying industry, managing 500+ remote writers, creating interesting angles through unique coverage & more

Episode Date: November 22, 2019

1:05 Jason intros Alex Mather 2:08 Why did Alex launch a paid subscription publication in a seemingly dying industry? 4:32 How & where did The Athletic start? What was their thesis? 6:32 What was early feedback like from investors? 15:57 Changing approach from ad-based to subscription-based writing 21:34 Why the NHL & MLB are great for The Athletic 22:43 How do they manage young writers? 26:52 What % of their spend goes to editorial? 33:00 Managing 500+ writers 36:20 What are some ways they manage engagement? 39:08 Twitter's impact on journalism 43:39 Scouting new talent & capitalizing on layoffs 50:10 What has the inflated valuations of BuzzFeed & Vox done to the digital media industry? 55:20 How is The Athletic handling Apple's app-store subscription explosion? 58:20 Apple's impact on the boom of incredible products in our society and how The Athletic translates that to editorial 1:01:56 Alex asks Jason: "Mayor of San Francisco or owner of the Knicks?" 1:03:47 Alex shares his thoughts on the NBA/China situation 1:12:01 How does Alex go about re-activating users who have churned? 1:12:42 What does The Athletic think about the prevalence of sports gambling in America? 1:14:55 Who is the most interesting NBA player right now? 1:16:01 Jason & Alex pick who they would start an NBA franchise with today 1:17:50 Jason plays "good tweet/bad tweet" with Alex

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Try the pod for free for 100 days at 8Sleep.com slash twist. Upcoming launch events. Apply for the next launch accelerator cohort. Applications are due December 23rd. Learn more and apply at launchaccelerator.co. Hey, everybody, welcome to this week in startups. I'm your host, Jason Kalakannis, and this is the podcast where we talk to founders about their vision for how the world should change through their startups, their products, their

services, and perhaps one of the toughest spaces to ever be a founder in is the media space. Let's face it, and it's an unmitigated disaster out there for newspapers, websites, everything except podcasting and email newsletters seems to be an unmitigated disaster. Everybody's losing their jobs. Unions are being formed while companies are going out of business. It's hard. It's never been harder. And I started in print publishing with Silicon Artreporter.

I did Weblogs Inc. With Engadgett. I do this podcast. And I am struggling building my own newsletter business atinside.com. I say all this as a preamble because anybody who starts one of these media businesses must have an incredible thesis and a lot of fortitude. The following guest, Alex Mather, is with us, and he runs Theathletic.com.

If you don't know what that is, it is a paid subscription sports publication, which Alex seems like the worst possible idea to launch in 2015. When you said, I'm going to launch a subscription product in 2015, after the investors laughed and your friends laughed at you, you then told them you were going to do it in the hardest possible category, sports. What on, welcome to the program.

Oh, thanks. Congrats on having over 600,000 paid subs that last we heard. And that was, I think, earlier this year. So it's probably getting close to a million, I'm going to guess. Why on earth did you decide to start a subscription model in a category that everybody said there would be no subscribers? Yeah, I think it's a story that probably a lot of folks tell you. which is as a user you felt a need. And as a sports fan, I'm originally from Philadelphia.

And I'm a six- I'm a Sixers. You're an Eagles fan. Oh, my Lord. It's still boasting about that one Super Bowl we won. So, you know, our teams are very rarely in the national spotlight unless we win a Super Bowl. Yeah.

Which we did. Yes. You've done that. How many the Giants win during that period? No, no, no, no, no, let's keep going. Hey, we are the only teams to have beaten the Patriots. We can... It's not amazing when you think about it?

We can relish in that. The cheaters. We beat the cheaters. Exactly. So... It takes a lot to beat somebody who's a systematic cheater. I just want to put that out there for the Patriot fans. Like, those guys, can you imagine being that good at what you do? And then you have to cheat on top of it.

It's just so... It's like counting cards or something. Come out me, New England. So, uh, you know, England. As a fan of teams that, like, if I'm a Flyers fan, I'm very rarely covered by ESPN or others. Oh, right. And so, you know, the teams that my co-founders from Cincinnati, the Bengals and Reds, you're not going to find them on the news. No.

So these are teams that are very rarely covered and felt that there was this opportunity to cover those teams in a way that places like 538 or Grantland used to or the ringer or ESPN cover the big teams. Right. So many people cover the Warriors, but how many people cover the Reds, right? So many people cover the Yankees. How many people cover the Astro as well? Right. So you had a thesis, hey, instead of going for the big markets, let's go for the underserviced markets first. That's right. And so we launched in Chicago in 2016. Great Sports Town. Great Sports Town. Generally undercover. Yeah, which is weird. Yeah. That's actually a real opportunity because they're kind of a major market that's under. report on. Yeah, they're not on a coast. And so we launched in Chicago in early 2016. Little did we know that they would break their 108 year curse that year. Right. And I would say, like our thesis was pretty simple, hire really great people. Think about, you know, the things where you can be different. As a subscription business, you have to be different. We, at my previous time at Strava, where learned how to build a subscription business, this, we also bought a lot of ads. And, you know, if you buy ads, you realize pretty quickly,

you're not going to buy ads on a local newspaper website. Yeah. And so friction is ridiculous. And you could literally get a hundred thousand times the reach for half the price with a better tool like Google or Facebook. Exactly right. And so we felt that there was these, these changes happening. They were, they weren't that controversial, the changes around advertising and digital media and felt that, hey, if there was ever a time to do something stupid and see if subscription worked, it would be in 2016. And very few investors agreed that it was a good idea. What did they say?

Because coming in with a media business, I'm sure if you email 100 VCs and say, I'm starting a media business, literally 70% are like, we don't do media. Yep. So now you're down to 30. You pull the Stravia card because you worked for a really successful. Is it Strava? Strava. Strava.

Yes. You worked for Strava, which is a very successful subscription business for cyclists. Cyclists and runners. And runners. That does very well. Yep.

They're doing well. Or did very well, yeah. So that might get you in the meeting. So when you got the meeting with the other 30 who didn't laugh. Yeah. What did they say? I think you hinted at obviously something

that my co-founder, Adam and I talk about a lot as fortitude. You have to take a lot of rejection. And the things they said, were very, very consistent. Number one, there's so much content out there, right? If your team, you know, if your team is the Yankees, you can find a thousand stories a day on the internet.

And what we'd always say is, like, have you read these stories? Have you clicked on any of them? And if you do, they're mostly aggregated versions of like two people actually doing the reporting. Right. You have two people who are the actual beat reporters who show up for Sixers games. Like, they're press conferences. be held like in a closet.

You could literally do it in a mini Starbucks. How many, that small, but yes. How many actual real journalists show up? At the Sixers is probably 15, but, you know, a team like the New Orleans Pelicans only have one or two people traveling with the team. So very. And do you think those riders, they're so desperate for coverage, they let those riders

fly on the plane with the players? Some do, some don't. We generally try to stay away from anything that would, uh, question our objectivity, but... Yeah, private aviation slightly might... Can you imagine you're like flying private and then you're like, you're going to write something nasty about the coach? And you're thinking about the economy class.

Yeah, you're like, okay, Southwest, safer fares. Exactly. So they said, number one, there's too much content, but what we kept coming back with is read it and tell us, you know, come back to us. Number two was, and I completely understand this perspective in 2016, is market size. So subscription, you know, you know, and I'm a subscription, you know, it's a smaller tam than, you know, an advertising business, which has everyone, right? Billions of users on Facebook. You know, Netflix is the largest subscription ever made. Ever made.

In the history of humanity. 170 million people, right? Verizon would be right behind it with over 100 million wireless subs. Behind that, it was the cable companies. And behind that, the other biggest would have been HBO via the cable businesses. So it's kind of related. behind that Spotify,

15, 20, 30 million, something like that. Now they're bigger, but... You know, they're bigger. I'm talking about paid, though, yeah. Yeah. And so, like, you know,

even 170 million worldwide, that's not that many people, right? Yeah. It's a small number, and a lot of investors got scared off by that. But, you know, folks like Charles Hudson at precursor.

He's awesome. Yeah, totally. He's good for a $250K check to get started. He put $250,000. $50,000 into the business. When it was a $5 million business. Something like that, yeah. He gets to own 5%.

And now the business is worth a lot more. You have 600,000 paid subscribers on average $30 is what it cost? $60 a year. I paid $30 because you have a $50. That's right. So let's net it out to $45 is what the average person is paying. So rounded up to $50. You're talking about a $30, $40, $50 million a year in subscription revenue.

So all of our discounts are first years in the weeds a little bit. but all of our discounts are first year. And that works. People retain very nicely after the first year. And so we get full price second year. 80% I would guess. Yeah, 83%. Oh, is it really?

I guessed it back closer. You did some cool stuff with a dollar for the first year, right? So we do so much experimentation. I think this is just never-ending game of understanding the best way to give people a chance to try your product. It's really hard to get someone to take their credit card out. So you try lots of different ways to get people to try. prior product at first. And we think once you read our product for 30 days, 60 days, 90 days, you'll go back and you'll be like, what was I thinking? It's like my example here is like watching

a Netflix show, right? You watch Netflix show, then you binge the next one, then the next one. And then you go back and put like your regular TV on. Oh, you want to kill yourself. There's a commercial. You're like, wait, wait, wait, wait, wait, wait, wait, wait. I have to wait till next week. Yeah, I don't even understand. Why am I doing this? So I'll just wait till the season three and get it on, how that changed people's behavior. I like it. Can you imagine any other business that's like, oh, did you like this ice cream?

Come back next week for another scoop. And you're like, but I'm willing to buy three scoops right now. I want it all right now. And so we think about that. Once you use our product with no ads, just the content you want, just the good stuff, you go back to the other world and you realize,

hey, this is saving me so much time. I'm getting so much more out of it. I'm learning so much about my favorite teams. and people love it and they just stick around forever. Why hasn't anybody else been able to make subscriptions? I think since Sports Illustrated. Sure.

Why hasn't anybody been able to make subscriptions work? ESPN has a subscription thing and it's terrible. It's annoying. They've got a very different goal around... It's for fantasy sports, right? Well, so that has been merged into their ESPN Plus product that's focused on video. And so they're buying rights for things like UFC,

college football, some hockey games. So it's much more of a TV product. They're doing quite well now. I think they announced yesterday, three and a half million subs. Oh, that's legit. But spending, you know, hundreds if not billions of dollars,

losing a few billion dollars over the first couple years. But it's a wonderful product, given the constraints of how complicated the rights businesses around cable versus OTT. But, you know, in the digital media space, like the simple version is, this story plays out in almost every vertical.

the incumbents have a really hard time changing who they are internally. Yeah, the innovators development, right? They've got to cross the chasm is really hard. It's really hard if your DNA is advertising. If everyone in your organization is built around advertising and you've lived so well for a century. Yeah. You know, we are very high up on the list of digital subscription businesses in the world. We're amongst companies like the New York Times, Washington Post, Wall Street Journal.

Which are low, single millions. And they are, on average, the companies above us are 142 years old. On average. That's the average that you're doing. That's the average age. They weren't, like we like to say, we're a media company of this century. They're not media companies of last century. Yeah.

They're media companies of two centuries ago. Yeah. So you have these companies that are incredibly difficult to change internally. And New York Times has done a wonderful job. They did actually. Yeah. When we get back from this quick break, I want you to tell me, what's the difference in editorial and managing the writers themselves.

So how does writer behavior, journalist behavior, change when you're at an advertising-based business versus a subscription-based business when we get back on this weekend store. You need to find the perfect software to solve your problem at work. But how do you find it? Well, you go to Kaptara, because you need to find a solution fast

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That's it. Software selection simplified. Captera.com slash twist. Okay, let's get back to this episode. All right, welcome back, everybody. It's this week in Startups. I'm not sure what episode this is. It's either 999 or 1001.

I've been doing this for a long time, dude. I'm tired. No, I'm tired. I love to do me. Congratulations. Thanks. It's kind of... Balloons?

We're going to do the 1,000th episode later today. We're going to tape it. And I had, like, a moment this morning where I actually felt like emotional about it. And then I was like, I've got to run my subroutine to this wipe out all these emotions about, I just get back to work to the next thousand. You have to enjoy the moments because you do. You do. Random number enjoyment is important.

I think it's important to just pick a random number and then celebrate it. I agree. So when we went to the break, my understanding is you have 500 journalists working for you. That's correct. Five hundred and four years or five years. Four. We're not quite four. I'm guessing you hired half of them in the last year.

About 280 of them in the last year. So more than half. So you added one person per business day and then a half person every other week, a person every other weekend. Yep. Just in terms to put that to scale. It was 365 days of year. Many weekends we've been recruiting, yes. Journalists are unique individuals in the world.

They opt, having been a journalist, they opt for that job for a reason. They're questioners. They're highly intelligent. They're high verbal. You have to manage 500, 280 of which we're hired this year, and you probably don't know, because the scale's too big for one person. I meet a lot of them, but yes, I don't know some of them.

Do they see you in just the journalistic world, these writers, the writer class, do they see you as the solution to the problem? And is their behavior, to my point, before we did the cliffhanger and the quick ad break, is their behavior changing now that they're not being asked by Business Insider or Huffington Post? to write link baiting nonsense and just try to get page views to service the advertisers. What's the behavior change that you see from people coming from writers, specifically, coming from ad-based to subscription-based? Yeah, it's a great question.

I mean, it is definitely new for my co-founder and I. And so we went into the business not knowing much. And so we learned over the last four years, a lot of what you just, said incredibly smart people, incredibly self-aware, like thoughtful about the business model. And Richard Plepler at HBO has one of my favorite quotes ever related to this kind of thing. And he said, create a place where painters want to paint. And so, and. Wait, who said that? Plepler from HBO. Ah. A place where painters want to paint. And they would know because people who would never consider doing television, will do HBO.

Yeah. And so we take that stuff very seriously and we wanted to create a company very similar. And what we said is let's learn from them what they want. What has been holding them back? What can we do to give them the tools to be whatever the best version of themselves is? We're going to need that. And so to answer your second question around behavior. Behavior, it's incredibly different.

It's so different that we have an entire team built. to help them manage this change. To unlearn what they've learned. That's right. And so. So when somebody comes with like, okay, I got it, 10 reasons why James Dolan is the worst owner in sports. What do you think?

And you're like, well, that never. Why only 10? That will sell, you know, all the time. 10? No matter what. But 10, I can name 100 off the top of my head of why is the worst owner in sports. We, we, what we do is we, we, how. help them understand, like, what their best version is.

And some people are really good at opinions. You're a person who is not afraid to share your opinions. Some people are really great at reporting. They love to make the phone calls. They're never not on their phone, digging in on something. Yeah, that's a carousher archetypes. Exactly. And then you have people who love, love to just break down things like a scientist or like someone.

Yeah, like those Vox explainer. explainers, but for, you know, exactly. What's that kid's name? Nate Silver. Nate Silver. Yep. And things like that. We love all types.

We don't have a specific type that is the athletic writer. But what we do is we work with them. And I'll give you a quick story. I think it's a really important one for us. So we had a writer come to us from a newspaper. He had been at the newspaper for many, many years. Decades. Decades.

And it was brand new and used to writing four or five times. a day. And he joined us and he's a hockey reporter. And he, in his first couple months, he was struggling to figure out how to best figure it out. We have this team that works with our writers individually, every single one a couple times a year, helps them understand. What do you call that team? Content analytics. So they sit with them. Yep. And do deliberate coaching. That's right. Like you might do for an NBA player who can't shoot free throws or their forms bad. That is the perfect analogy, we call them our strength and conditioning coaches. They're not, they're not responsible for hiring and firing, comp, anything like that. They literally just make sure that the people are in the best shape of their life. That's their only job. And so they worked with this gentleman a couple of times and convinced him to go out of his, you know, routine and go to another country and do a story in another country. He flew to Russia, did an amazing story. And, you know, he had been in a newspaper for a while. And, you know, he had been in a newspaper for a while. And, You know, it doesn't know the future of the media business.

Well, he drove enough subscribers with that story to keep him employed for the rest of his life. And just that one story. What was it about? Like how they have turned out. Yvgeny Malkin just walking through life with the Afghani Malkin in Russia. What's that, Afghani Malkin? Yvgeny Malkin is a player on the penguins. Ah, got it.

I literally do not follow the NHL at all. Yeah, there he is. There's the story. What can we just take an aside here? Yeah. You're in sports and you're passionate about it. Well, how did the NHL go from being what it seemed like in the 80s and 90s being a league that was interesting and people were very excited about to being an outcast? What happened?

I mean, I am such a huge hockey fan. I grew up watching the Philadelphia Flyers. Too slow? It's such a wonderful game live. It's tough on TV. It moves so quickly. You can't see the puck. Yeah.

No one can see the puck. It's tough to figure out most of the players are European. And it's become a tribal sport, a lot like baseball. You know, you're not just going to throw on your TV and put a random baseball or hockey game on. These are sports that are wonderful for us because the people who are Flyers fans aren't shrinking. Right. They're just being covered by a few. Didn't they lose their national television deal at some point?

NBC has it now. NBC has that. Yeah. And they do it wonderfully. Yeah. They cover the sport wonderfully. It's just, it's taken a backseat a bit to the NBA and the NFL, obviously. And that's a shame.

So with the riders, they used to, they were trained for many years to be link baiting and to be driving audience. And it seems to me that this young generation has only known that because I started in the 90s. And we were told, don't talk to the sales team, fire the sales team if they come into editorial. Now the sales team is embedded in editorial. The editors are being asked to write sales materials. I mean, that's gone. It's pretty wild. It's pretty wild.

The firewall's gone. Then they were asked to do fact checking, proofing, and to have three sources. And now, just as a subject from time to time, and anybody who's the subject of journalism is super depressed these days because the majority of them never even call you to tell you You're in the story. Yeah. Yeah. I mean, it's, it's.

Do those young journalists even know how to do proper journalism? A lot of them. A lot of them, you know, so the example I used, uh, from a gentleman who had been in the other side of the business for a long time is just as, um, valid for folks who are new. We, that content analytics team we have focuses just as much on our young writers. We call them like our level one writers. It's our fastest growing team in the company. Is level one?

Is level one. Is that out of school or one or two years? A couple years of experience, maybe, maybe out of school. So like 40, 50K years or something like that? I'm not sure about the salaries. But, you know, what we think about there is, hey, you have a blank slate. And you have the best team in sports journalism to learn from. And so we do a lot of pairing.

So we'll pair them with a great journalist. Ah, mentorship. Yeah. See, that's how it worked in my day is you had to work with another editor. You had to not work with another writer. They would pair you. Yeah. I mean, a lot of this can come back to like, you know, we all saw the silly we work deck the other day, you know, profits and operating expenses and all that stuff.

If you were to simplify our business, it's like, you know, do quality reporting, hire the best people to do the best reporting. It turns out people like that stuff. They love doing that. Yeah. And not only do people love doing it, the best people in the world when they do it and you get to bring enough of them to get. people will pay for it. And so it's not really that simple. Like business isn't that simple. It's a slower process. And that's been, you know, as we've raised money, we've raised a lot of money. You know, that's been one of our things with our investors is like, hey, this is not

the hockey stick crazy growth. This is. Yeah, two to three X year over year. Exactly. You're not going to five X a media business. It's hard enough to double or triple revenue year over year. The good news with subscriptions, though, is you do have to do have to be a lot. You do have to be five. You do that foundation. Yes. Advertising, you got to earn it every year. It's so annoying. So with subscription, obviously, like we build that base of recurring revenue.

We, if we engage our subscribers well, which we do, 90 plus percent weekly engagement. This last previous month of October, 98% of our subscribers were active. Wow. It's the height of the sports season, right? Everything except college basketball is being played. 98% of our subscribers were active. We're active. That means they looked at a page.

Yep. They clicked on the email. They read an article or listened to a podcast. That's unbelievable. Yeah. And so if you do those things, you know, you can count on those subscribers year after year. Our retention from year one to two is over 95% like across all of our cohorts.

That's bonkers. Our most recent one was 98%. I think it's because you charge just a fair price. Yeah. I think we get, how did you come up with the $60 price? A dollar a week? Yeah. I mean, what we said is like, you know, we wanted to be somewhere.

a dollar a week, $5 a month range. Which makes it so cheap, you're like, oh. Especially if the first year's discounted. 20, 30 bucks. Yeah, it's like $100 for two years. Why it's it being a dollar a week? You're like, well, that's nothing. That's right.

And so, you know, that has been our approach to date. You know, longer term, we can look at pricing, thinking about things like fantasy to get folks to pay us more money. But, you know, right now it's really back for us. Exactly. So if every dollar you spend, because you don't have to have a sales marketing publishing engine and a social media and all this other nonsense to like market the heck out of this. You have 500 people in editorial.

What do you have like 100 business people? 75 business people. I'm guessed it almost exactly. Yeah. So that means those people get paid a little more than riders on average. I'm going to guess. But who knows? They live in San Francisco.

So yeah. Yeah. Double. Okay. So that's like having 150 people doing it an equivalent. So basically 70 cents of every dollar that you spend goes to editorial. Yep. 70 to 75% of our.

our budget goes editorial. Think about that. What do you think Vox or an ad-based business like Huffington Post or something does? I'm going to admit, I have absolutely, you know. I can tell you, it's sold my company. I have no idea. I can tell you. It's literally 70 to 80 cents on business sales and marketing.

Got it. 20 cents on the dollar. Wow. Yeah. So, yeah, we've inverted it. And I think that's been our goal from day one. And I think that's earned us so much trust with our newsroom is that we invest everything we can into them. And because we want to keep them, right?

Our business doesn't work if we can't have the best people. And so we need to keep the best people. So they're all full time. They all get equity. Every single journalist in the company gets equity. They don't even know what that means. They're just like, what? They do now because.

You have to educate them. And there's been some secondary in previous rounds. Oh, really? Oh, you know. Yeah. Oh, so you let them participate in that? They can participate. So that's a smart move.

Yeah, and long term we... Yeah, it's real money. And the folks, we've loved when they negotiate equity. Oh, that's such a great moment. Yes. Oh, my God, you're along like me. Yes. You don't just care about it.

You believe in the company. And you'll profit from that. And so that's been our approach from day one. We give California benefits, paternity leave, maternity leave, all those things to everyone. And so at a time when every media company, you know, you talked about journalism, being a tough space, you know, because they've treated their folks like labor, right? They have. Like factory workers.

It's been a standoff. It's been a standoff because having lived through it when when everything is going bad, it gets so toxic that everybody gets scared. And when people are scared, behavior gets really weird. Yeah, you start looking behind. Everybody's over their shoulder. The mid-level managers are wondering when they get fired. Or the upper-level managers are wondering when they get fired and the mid-level managers

get their jobs. The journalists are like, okay, when does this company get bought by a private equity company? And then we all know what happens then, right? And that's sad. I think we know what happens when the private equity people come in. Yep, that's really sad. And so we said, you know, let's take this on. It's going to mean significantly higher content costs, right? For sure. Right? But if you look at a company like Netflix or Apple or HBO, they pay up for the best people. And they keep the best people. And they continue year after year to produce the best content in the world. How do you deal with the fact that San Francisco is journalists in San Francisco get paid two to three times what a journalist in any other city gets paid? And then people in New York maybe get 50% more. How do you deal with that?

And also work from home culture? I don't I don't have our exact numbers. I don't think they're that stark. But I think that there is a cost of living adjustment across all of our entire business. I'm not sure the exact information. Do you believe in this work from home? stuff? I mean, we don't want everybody to be in an office and work. Of the 500 editorial folks we have, a very small percentage, single digit percentages, work in an office. Really?

So they're... So it is a distributed workforce. They're at stadiums. They're at practice facilities. They're on the road. Because you can't, you'd have to have an office in every city. Yeah. And so...

Or are we working something. Like from a KAPX perspective, that's just not in the plans. How do you, when we get back from this quick break, how do you manage 500 writers that are working largely remote and spend half their time out of the office when we get back on this week at startups. You're thinking about going to the gym today? You're thinking about finding parking. You're thinking about waiting for a weight machine.

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And I've been so impressed with this product. I bought one and I love it. Okay. Let's get back to this amazing episode. Hey, everybody, welcome back to this week in startups. Alex Mathis here. Thanks for doing the pod. You don't do many pods.

No, I'm pretty shy. Keep your head down kind of guy. Yeah, yeah, I'm pretty busy and shy. How do you manage 500 riders having not come in? You didn't come from the media business. Nope. How have you, what have you learned about managing 500 riders? Most people would say it's like hurting cats.

They all have an opinion. The opinions are going to be super varied. And they all think they're smarter than you. And in some cases, that might actually be true, having worked with a lot of riders. These are smart people. They are. How do you manage 500 of them? So, you know, it's controlled chaos, but I did manage designers and engineers in San Francisco.

Also very smart. Opinionated. Also opinionated. Also tough to manage. Not too different, really. And, you know, what I would say is like this is going to sound very. very Silicon Valley, but we've taken a much more of an OKR approach to the business. Gotcha.

Like very, very numbers oriented. How can we break the year up into chunks that makes sense? And for an NHL writer that's different than a college basketball writer, but how can we break it into like things like off season, preseason, season, postseason, that kind of thing? And then you give them some goals as to how many stories, how many readers make it to the end of the article. That's right. So most of our focus is on three things. Number one is productivity. Like we have to, we, you have to hit our baseline productivity, but that productivity is, is that like a word count? No, just number of stories. Number of stories. And so that's what,

one a day? No, it varies per sport. But, you know, it's about 25% of what another company's productivity goals would be. Yeah, because they're going for break the, this is a direct result of what Peter Rojas did it at and gadget. When we, when we, when he, when, when, he was running a gadget and he previously created Gizmodo, he was like, okay, the iPhone's coming out. We're going to do these 25 stories about the iPhone. Unboxing, he created, the live keynote, the accessories, the operating system, and he would map out these are the 25 stories so that they could have excellence on each one. And then as a delightful ramification of that was we would beat Walt Mossberg because he would

write one story about the iPhone two weeks later. We would write 25 when it was launched and then another 25 we had the structure we do 50 of them and then SEO would be bonkers It's like iPhone 3 battery life

We try to marry a little bit of those two Right One's not right right Or one's not wrong What we say is like Like don't chase everybody else in the locker room If everyone else is going to go

put a microphone in front of Steph Curry You know go to go talk to Clay Right Yes Go talk to Draymon Right Get a story So at the core of what we do is storytelling, where we try to be different.

But back to how we think about productivity, engagement. So as we go into the millions of subscribers, engagement becomes the most important thing possible. And defining engagement, what are the factors for engagement that matter? Yeah, no, I think it's important because I'm an investor in Medium, the pal Evan Williams, started it. And his thing when he was starting was we're tracking how far down the story you get. Yes. Time on page.

And that was, he's like, just wanted to see what percentage complete and read the story. Yeah. That's important. And they've done

some really cool things around thinking about that problem. And so we look at a bunch of things. Number one is, um, of the percentage of active users for the teams you cover. Percentage of active users for the teams you cover. So if you're a Knicks fan.

Oh God. I'm sorry. Um, if you're a Knicks fan, how many Knicks fans were active this week? And then what percentage of them read your story that week? Oh, at that moment in time.

And so we're not. penalizing you if the folks aren't active because the team might stink. I don't know about the Knicks, but your team might stink. I think we're one in eight. And it's going to pull up. Not with the first thing is story. Come on. I just read this this morning.

I had to get like two paragraphs in. And I almost threw my 38-inch monitor. I can imagine. So that's number one is how many of them engaged this week, right? So we're not going to penalize if your team stinks. Number two is how far do they get in the story? We actually have, if you scroll down to the bottom of a story, we have MPS on stories. Right.

How likely do you refer this to a friend? Well, it's kind of like MPS. You say something else. We say like, what do you think? Yep. And so it's our little version of MPS. There we go. And so.

I didn't realize you got Frank Isola. Yeah. He is so great because Dolan hates him so much. And then he hates Berman. Yeah, there's a lot of. Mark Berman of the post. There's a lot of animosity there. I follow Frank.

I follow Frank and Mark Berman on the Knicks on Twitter. And Frank disses Mark Berman every chance he gets, but he doesn't at mention him. So what I do is I say, you forgot to at mention at Berman, but I do it. I've done it 50 times. Well, thanks for driving engagement in some of our people. It's called trolling. Yeah, I know. When you're a Knicks fan, it's literally all you have. And to Twitter, that's called engagement.

It's all we have. And so number two is, you know, like how far, how much do you engage with the story? Number three is community. Are people engaging with your stories? Are you engaging with them in the comments? That's one of our differentiators. Yeah. If you're a Francoe Sola fan, you can talk with him in the comments.

So access. Access. Access. And they're given the time to read and reply to comments. I mean, just think about a journalist's life. How many times a day are they on Twitter responding to people? Oh, my God. It's all day long.

Right. And so it's ridiculous. How do these journalistic enterprises allow people to do that much and so little on their own side? We should be talking about their mental health because Twitter is, you know, it can sway you quite often during the day. But, you know, we ask them, spend a few minutes a day, go into the comments and talk to the people who are paying our bills, right? And so that's- You actually encourage them to do the Q&A sessions, like you do ask me anythings? Exactly. And it's been so effective. We've brought down the server a few times with some big names in the UK, and it's been really fun. That's interesting.

What do you think of Twitter's impact on journalists and their mental health? Because this seems to be an acute problem. Well, first of all, I think Twitter has been the best thing to hit journalism ever. Why? Because it's replaced RSS feeds for all of us, right? We all used to read our RSSs. I miss RSS. Yeah, me too. I was a little more sane then because I really couldn't see what I didn't subscribe to. But, you know, it has been just a wonderful place to see the news unfold. If something's happening, there's no better place in the world. You know it. You go straight to Twitter. You're not going anywhere else. The news article on the fastest website might come up 15 minutes later, right? And that's a poorly edited story, right? Twitter is where it happens. So it's an incredibly powerful tool,

incredibly important for journalism. That said, the externalities of some of the behavior on Twitter, where everything becomes binary. Like the behavior is so binary. And if we're all just attacking each other. That's just not a life. I want to live. Yeah. So I tried to limit my exposure to it. But also sports is so cantankerous. Like, you have the joyful ringer team. They seem to not get into it with people. They seem to just live for, I think they must have like a handbook that says just always be positive and obsessed with sports. They just love what they do. They just love what they do. They love what they cover. They're very good at it. Yeah. They're great. They're great. But then you have the deadspin dipshits who are like angry at the world. And they all get fired. Right.

For basically being at war with the people in the private equity firm that are trying to save their jobs. And I did this tweet on, I don't know if you saw it on Friday or Thursday. I did a tweet where I was just like, if this matters so much to people, the deadspin thing is trending. why don't they start a Patreon or a substack and capture $25,000 a month in subscribers, and they could pay five of them, and then they own 100% of the publication? Yeah, I mean, Desbin has a brand that people love, and they absolutely, my guess is if they did that, there would be a lot of interest because people, I mean, they had a very unique voice in the space. Yeah. And my guess is it would be effective.

It would totally be effective. Yeah. And substack and... Will Leach started it. Yeah. Will worked for me at Silicon Alley Reporter for a year or two. And he started his life of a loser blog where I didn't know he had that. You know his blog? Yeah. And he was writing about me as like his anonymous boss a couple times. It was pretty funny. You did not know that. And then he pitched Denton and I on the sports blog and I offered him more money than Denton. And he went with Denton. No comment. There's a big mistake because Peter Rojas and the other guys made millions of dollars

because I gave them equity. Equity is a powerful thing. And, you know, I think if you have a powerful brand, you can take advantage of that. And I think places like Medium, Substack, Patreon have given folks a way to take a lot of that stress out of the business side of things. And yeah. Do you see that as a competitor to what you're doing? doing that in that if somebody really is driving subs at your publication, and they build up

their Twitter, they could go be independent. And has that happened to you? We see the opposite, frankly. People try to do it on their own, get to $20,000, and then they come to you. And then we can, we quickly understand how we can pay them better. And they don't have to worry about it. They don't have to write every day. You know, there's not many people. Yes, they get benefits. Yes, they get benefits. They get editors. They have teammates. Not many people are like Ben Thompson or you. who can, are prolific, right? It's also lonely, too. You know, and you want to talk to other people.

This is one of the things about being indie. It seems like a great idea until you're alone in your underwear for the 100th day and you're like, I haven't showered. 50% bump on stories that have multiple bylines in terms of subscribers driven for us. So when people work together on our team, amazing things happen. So, you know, we generally look at things like, you know, Patreon and Substack as, as feed. systems for us. What's the playbook for scouting new talent? I mean, I know you guys just cleaned up when ESPN was like, we're going to get rid of all

the people you love. Yeah. I mean, it's a multi-phase process that, like, you know, unfortunately, the environment was such that you had some really great writers being let go everywhere. And whether it be a newspaper, a blog, a magazine like SI, or a television company like Fox, right? You have all these places that are not spending as much money on the written word or journalism. And so here we are as a plate, a really nice landing spot for them.

And that was 2017, really. 2018 and 19 has been, we flipped it. I think for many people, not everyone, of course, in the world, but for many people who love what they do and want to do the best work of their career, we're a beacon. So like any company, in the beginning, you have to earn it. And once you earn it, you become the place where people want to come. See, if people don't understand how powerful that is,

of having to search for deal flow, instead of having to search for talent, the talent is in the lobby. That's right. And that's what happened to Netflix is at HBO previously is that once Netflix started paying people well and the product and they gave them creative freedom, the Netflix lobby in L.A. is known for being just a place where people hang out. Right. Talented people. That's right. And it actually happens in venture capital too. Like first five years of angel investing, I was searching for companies.

Last five years, I'm sorting. I mean, and I can guarantee you the best way that you. you get deals is word of mouth, people saying literally people stopping me on the street or emailing me. Yeah. And so word of mouth from our journalists to others goes so far in them deciding to leave a job of 30 years, right? We went over to the UK. We hired 60 people in three months from the best, best outlets there. And they talked to dozens of our folks in the U.S. How do we treat them? Is this for real? No, that's it's a legitimate question. Like, is this real?

Right. Or is this going to be BuzzFeed again? Right. And so. BuzzFeed and Vox, not Vox, Vox is good. Jim Bango is the guy who bought Weblogs Inc. And then took the entire Weblogs Inc team and created the verge, which I give them credit for, smart move. The, the Vice and the BuzzFeed growth, the hyper growth and the hyperfunding of those.

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I am a super fan of the company. And now, yum, yum, I was able to get a little slice of their last round. And I put a couple hundred grand in because I love this product so much. Okay, let's get back to this amazing episode. All right, listen, if you haven't signed up for The Athletic and you like any type of sport, go to the athletic.com right now, click on the 50% off and sign up. It's absolutely the best sports content tied for me with the ringer. We'll take that.

Thank you. And unbelievably better than SB and this other horrible stuff. What's the other one that got bought that that kid from Bustle created? What was that one called, Nick? Bleacher Report. Bleacher Report. That is the worst schlock in the world. I know you can't say that because you're being magnanimous.

You know, I almost went, I emailed Google News and asked that bleacher report be removed. That's how much I hate that. Do you know why? Why is that? I'm at the World Series of poker. Okay. Ten years ago. No idea where this story's going.

And I'm checking my phone. Okay. Because today is the day of the decision. Oh, okay. I know where those stories are. And LeBron James. picks the Boys and Girls Club right outside of

White Plains where the practice facility is and I get three or four people in the know in New York texting me it's a done deal LeBron is coming to the Knicks and I open my Blackberry and I check my news feed

and it says LeBron James coming to the Knicks breaking news and I click the link on Bleach Report. And you know what the first sentence says? That's what every Knicks fan hopes to hear in one hour. That's writing a check you can't cash. Oh, my God, I was crazy. I literally know the guy who was running Google News,

and I said, you have to take this shilocks. Look what they're doing. And then I found 10 examples of this garbage website doing the same technique, which is lying in the headline to get the clicks. I said, how can you allow this fake news? That is, before fake news. They were fake news before fake news. Wow.

Okay. Yeah. Four or five years ago, we had BuzzFeed and Vox on a crazy trajectory. These things were going to become $25 billion businesses, and people put hundreds of millions into it. The venture community then realized that that's not how this works. Those companies have since taken major haircuts and valuations and are probably in arguably a debt spiral because they raised at such high valuations that they can't ever have those investors get the return they expected.

And now they're going to be caught between the expectation of those people and the reality of the business. What is that done in the ecosystem in terms of media? And how do you look at those businesses that just went so big? Because you must have been thinking as you're starting, well, maybe I just get a $300 million check and do this. Just trying to get a couple hundred thousand dollars. But, you know, I think it's complicated, right?

I don't know the cap tables of those companies. I don't know how they're going. But I think they've created companies that will last. Will they be as big as anyone hoped? I don't know. I'm an optimist. I hope they do. I don't hope anyone fails.

As you know, better than almost anyone on Earth, it's really hard to figure. out how much money to raise as a company. It's the Goldilocks. You've raised 90. Yeah, we've raised 90. And it's it's not simple. It's too little or too much. It's, you know, how do you capitalize the business perfectly? Very few do that, right? So I think, you know, that everyone perhaps got on a hype cycle and perhaps they overcapitalized. Yeah. And perhaps took money. I mean, if you get down to the root of almost a lot of the Silicon Valley evil is people taking money from people who they shouldn't be taking money from. Yeah. It's not really that complicated. Venture is pretty efficient. Yeah. To date, it's been a very efficient structure because the investors only get paid

on the increase in value, with the exception of people who are washing money, who if they get 50 cents back on the dollar, they've washed it and gotten it out of the country they were in, that's okay. And so you have folks who have different incentives with their capital that perhaps are putting a lot of money into these. companies. And that's, I think, where most of the problems are coming from. Now, what is it done to the industry? It's really messy. I mean, there's not really a playbook for a digital media company to start now. You know, I think Bustle's doing what it can, and I think they're doing a wonderful job at what they're doing. But outside of that, it's really hard to create an advertising built

business. Why? Why is it so hard to make advertising work in these publications today? I mean, Facebook and Google, right? That's like the simple version. They take. they've taken all the wind out of the sales of any advertising business online. Yeah. Right. And rightfully so, they've built amazing products. If I'm buying ads, I'm buying it there. Yeah.

Right. That's really simple. And if every company wants to buy ads from them, then, you know, what's everyone else left to do? It's probably to, you know, join forces and, you know, form bigger conglomerates of these companies together. And I don't see a future. I think if I look 20 years out from now, I do not believe that advertising supported digital media will produce quality content. And there will be significantly less of that content.

Can you get to 10 million subscribers? Yes. Yeah. So you can 10x from here. Absolutely. What is it going to take to do that? What's the timeline? Time.

Mostly time. Take a decade? Yeah, maybe more. Maybe more. But, you know, I think patience focusing in on the economics of the business, not getting to a head. of ourselves, you know, getting to profitable as soon as we can and feeling like we control. You're close. Yeah, we're not too far. You're not too far. And you raise 90 million. Yep. And you have the best investors in the world. Yep. Founders fund. Founders fund is amazing.

Yeah, well, they're contrarian. Yep. And so that's the perfect investor. How many investors say they want to be contrarian and then at the end of the day, they're not. They're like, tell me about your photo sharing. Yeah. Tell me about your SaaS product. Yeah, exactly. And, you know, tell me about whatever strategy. is hot right now. What's your AI like? Well, yeah, machine learning and AI is like literally, I have the ultimate way, if you ever want to get it to angel investing, all I say to people, when they bring up AI machine learning, I said, oh, okay, who on your team does that? Yeah. And they're like, we have an open position for that. I'm like, oh, okay. So you're an AI

machine learning version of Salesforce without AI. Without an AI or machine learning person. And then sometimes they're like, well, I am. I went for machine learning. I went to Stanford. And I'm aspirational six feet tall. Exactly. So, I'm playing point guard for the next. Exactly. You know, I think, you know, it's patience, its focus on quality, not chasing trends. You know, I joked about the WeWork slides, but it's simplicity. It's like just be a good business, treat your employees well.

Let's talk about 20 years from now. And I think, you know, our folks have bought in and let's just continue to march. Subs in the app store have gone completely bonkers. Yeah. We were the first investor. and Calm.com. Congratulations. Yeah, that worked out. I know, yeah.

You know the boys? I've, no, I've just been following the business because they have just done incredibly well. Very scrappy marketing team. Very wonderful product. Great subscription business. Yeah, they, uh, nobody believed in that product. Yeah. And somebody wrote on Cora.

Well, Jason Calacanis was $400,000 investing in common. I like wrote my rebuttal. I was like, Phil Jackson got Kobe and Shaq to do meditation. And Sam Harris is studying it at UCLA. I think it's, I think it could be. meditation and mindfulness could work. It's important. Oh, yeah.

We're all going a little crazy. And then Trump got elected and they became half of the year. And so you never know with these investments. I have never put those two items together. Oh, 100%. Oh, my goodness. I mean, have you been able to sleep? I mean, do you listen to Rachel Maddo putting you to bed every night and then grind your teeth?

I have a nine-month-old son. I do not sleep. You don't sleep anyway. So you're all set. Oh, here it is. Was investing, was investing facilitating a 50K investment overall, $400,000, including backers and calm, a meditation app, a good move by Jason Galcatus. And here's my rebuttal. My job is to find the binary projects like Uber that most folks don't understand until they

change the world. I mean, isn't that the key, right? It has to be non-consensus until it's consensus at some point. Yoga and $4 coffee's are examples of crazy trends from the 80s that have become something almost everyone has either tried or participated in 1987. The idea of spending $3 on a 25 to $50 a cup of Joe was insane. I thought that was a pretty good rebuttal. It really is. I believe it. I was right. Because you don't think is, you only have to be right once. But you don't have to, I mean, let the cap table handle that rebuttal. This is hilarious.

Look at this. Of course, I think it has a 70% chance of becoming $100 million plus business that I'll get my investors at 10 to 25x. It's 200 X. It's a lot bigger. Hey, and it's a $1.2 billion business. Congratulations. Worked out. We look at them as, you know, we look at them as a pioneer in subscription and they've done incredibly

well in the app store. Do you get app store subs? Something about a third of our subscribers come from from the app stores. And you're happy to pay Apple 30% and then 50%. I mean, happy is an exaggeration. We are willing to pay that money. You'd be happier if it was half? I'd be happier if it was market, but they've created their own market. What would be, 10? Three. Oh, oh, you like a credit card. Credit card processor. Here's the thing, though. I think it's worth it. I've had this discussion with many Founders. I 100% agree it's worth it to be clear. Because if you give them their Vig, they will feature you. Yes. And they will contact you and they will work with you. I love the folks I work with at Apple. They are wonderful people. Easily. They provide value. Yeah. It's not even close. They

believe in like, you know, this is going to sound like I'm kissing their butt. But, um, well, let's do it. No, I want to get this podcast featured again. I think it's really important. like we were moving as a as a society towards like really shitty products for a long time really cheap shitty things um whether yeah schlock watches that were 10 cents right whatever um they came along and created the best product in the history of products period yes and then they just continue to create products that are worth paying high margins for right right like well worth it's not even close right like it's not even close right like it's not even close close. And look at any company now. They're spending money on their packaging now, right? People have

realized the world has moved away from excess to quality. And I think that's a really big deal. Sony Walkman's used to come in plastic that you needed to have industrial strength scissors to cut open. And then half the people opening it would wind up with a cut. And then 10% of those would wind up in the emergency room getting stitches. Because they sealed it in this ugly plastic. Now you open it up. You feel like it's a fabric. There's like a, you just pull a string and music plays. I love the delightful. Yeah. The thing that's the most satisfying is when you peel the plastic wrapping your AirPods.

You know, it just snaps off. It's amazing. But, you know, that's the business we want to create too. Yeah. We want to bring quality to media in the same way they did that to physical products. And that's been important to us. Yeah. And so I'm willing to pay it.

Love them. What's the equivalent of the unboxing experience for you in editorial? Yeah, I think what we tried to do, and this is an ongoing experiment, but like if you join our product and you're a Knicks, Giants, Warriors. Nick's Giants, Yankees. Yankees. Rangers. That's New York. Now, if my grandfather was still alive, the rest of the solo would be Mets.

Okay. Because he had the Dodgers of the Mets, but my dad was Yankees, so it was a little bit of a problem. And then on Monday, I guess, there it is, Giants, Nicks, Rangers, Yankees. So even my nephew is in line with the property. So, you know, we've done some incredible journalism on those teams that might have been a year ago, two years ago, whatever. I know Mark Carrig wrote a story with, you know, Saras about the Yankees that was wonderful, right? It might be a year old at this point, right? And so how do we delight you in your first week and give you stories that just like make you feel like you just made the best decision of your life?

Oh, so if I sign up and follow the Warriors and next, which is what I did. Yes. You just email me and say, Kevin Durant, we did the Hampton's Five story. Yeah. Right. A wonderful story. Clay playing tennis, getting the gardener to play tennis with them. I mean, how charming is clay, right?

He's the greatest. Yeah. And some great clay stories. Off the record, I'm sure. I can tell one. So, you know, can we get you those stories. Once you read those stories, you're like, I love this product. It's for me.

Stranger Things. If you watch Stranger Things in your first week of Netflix, are you ever leaving? No. Right? Like that soundtrack, just play it. Just like if you're in like an 80s kid, it is literally like hitting every note. The season three, I mean, it felt like it was made for me. No spoilers.

My wife and I haven't quite. I won't say anything. I won't say anything. But you'll love it. It's going to be amazing. How do you handle the leagues? Because you have no tie to them other than access. Yeah.

But people do play access games as, Of course. Mr. Dolan does, which he should just be banned for like these access games that he plays. Yeah. I'm considering committing NIC's suicide, Sapuku this year. So I have a question for you. Yeah. Mayor of San Francisco or owner of the NICs. Yes. Both. But order. Let's go. Let's go. I can never own the NICs. No matter how much my net worth goes up. The NBA goes up faster. So it's a lost cause. I mean, I literally, it's a loss. And they don't let you pass the hat anymore.

So the sports teams used to let you pass the hat where you could just get... Tell us what that means the normal people on Earth. What does that mean? So Wick gross back. I know Wick. Yeah, Wick from the Celtics. He got a group of 50 people together.

Everybody put in $5 million. He bought the Celtics. Yep. I see. He becomes the owner. You pass the hat. Got it. Warriors.

Joe Lakeham passed the hat. Chamoth and a bunch of other people put money in. And then a bunch of people like Chad Hurley and other people put in like literally a million or $5 million and they own one basis point, one point, 50 basis points, whatever it is. So they have an ownership team that comes to every game, sits in the front row. Now my understanding is you have to be bomber and be able to pay for the whole thing yourself. They don't want these ownership groups.

Being so diluted down by so many people. Yeah, I think they just want to be able to go to one person and say, okay, bomber do this or, okay, Russian oligarch, do that. Whatever. Mark Cuban. They want that prototype. Which means the Knicks at $7 billion or $4 billion, $5 billion, whatever it wants to be going for it. I mean, Bezos can buy it.

You don't care about sports. But Bezos can. I think Bezos is the likely, that's what I've heard on the inside, is that Bezos is going to buy it because he's spending more time in New York. So Beza, I mean, you can have that for the athletic. But anyway, that's the rumor amongst the insiders that I know is that Bezos is circling. And that would be great to dunk on AOC. Can you imagine she banned the Knicks?

and then he invites her to sick court side. Whoa. What do you think about the China situation? Because you don't care about your, you're not beholden to the league like ESPN is. No, we have no outside money. You don't care. No, we don't care. So what do you personally feel about that situation how went down?

Darryl Morey should be sanctioned and fired or celebrated? You know, my personal opinions around the political situation, aside, I think it's shining a light on something that's important to talk about as a country, which is, where's your money coming from, right? You know, where, you know, who are you beholden to and why? Right. And where are your values? And, you know, there's, you know, there's a spectrum of all these things.

There's no right or wrong. These are complicated situations. And, you know, we always ask ourselves at our company, which is like, let's make sure our money's coming from places where we can always be objective. Always. Whether it be leagues, whether it be other companies, whether it be countries, right? How can we be objective? And if you can't, then you're in a really tough spot. It's going to come back to by you. You see all these cases of cover-ups, right? Whether it be universities and things, don't, don't hide. When you hide, the light will find its way. Yes. And it's finding its way to a really,

really complicated situation where there's a lot of people making a lot of money off of a lot of places that are doing really bad things. And these are complicated. It's really gnarly. It's hard to unwind. It's hard to unwind 10 years from, from Yao Ming to now, of building up this business in China only to realize that if you even modestly, modestly are in pro human rights in China, that they will yank the chain and they've got the NBA on a leash and they are yanking the chain now

and my God, for LeBron James, a billionaire, it's complicated. Honestly, it is not. I think you're being magnanimous, Alex. For me, it's not complicated at all. If you make a billion dollars

and 300 million of it comes from China and then as a billionaire, you made all that money in power and influence and then you have to kowtow, who cares about the last? last 300. It's the first 100 that matters. You know, I personally very much agree with you. That said, from a big business perspective, I mean, it's complicated. You know, I think the complicated part is you have athletes being put on the spot, right? It's hard to talk about this stuff because what I mean

when it's complicated, it's hard. There's people in the country that lives are at risk, right? Oh, yeah, that is complicated. Yeah, it's really complicated for the players to talk about the the coaches, you know, poor Steve Kerr, right? Like, that was so, like, it's complicated for these folks to represent at all moments, everyone representing all things, right? It's really hard. Yeah, to have a unified voice when you've been basically turning a blind eye. And my, yeah, my wife's family is from Hong Kong.

It's, it's a really bad situation. No one wins in these, like, you know, when we talk about sports at the athletic, the only thing, we don't care who wins and loses. We just, like, the only thing that really, really suck. is when people get hurt. You know, that just like play, when the best players on Earth get hurt,

like, it's just, it's just negative. Like, there's no positive to any of that, right? And I think of things like this is just negative. It's, you know,

when there's bad things happening in the world, it's just negative. There's no positive to it at all. It just shows, though, when you engage with people who have human rights violations and stuff like that, and they're using their money

to mask the human rights violations, then what happens is, we as Americans go from being the beacon of hope in the world to the sellouts. Yep. I mean, we sell out every day as humans, though, when we buy, when we want our things to be cheap. Yep. And, you know, are we willing to pay the money when folks in these countries aren't making the product, right? It's all we're in a, you know, globalization has created a really complicated world.

And it does. All of us have to ask those questions now. And the light is very, very bright. How do you think, do you have journalists in China? We did. We did. Oh, you did? During the controversy, we had multiple folks there.

And so it was complicated for us, too. Did you not cover it? Oh, we covered it. You covered it. Yeah. Does that mean those journalists are at risk in some way for covering it? I mean, we have to be very careful with folks in the ground and what they do and how they act. Can you have people on the ground as journalists in China even?

It seems like that. Yeah, they go along with the teams. Oh, wow. It's a wonderful experience for them to see the part of the world. But these are American riders? Yes, of course. So American riders there, you feel safe? Now that they're home, yeah.

But if you had an opportunity, Baidu, whoever comes in with the big dollars, let's just pick a company, Alibaba, whoever, and they say, here's 200 million. We're starting it local. I watched the last episode of Silicon Valley. I didn't, I'm not up in the season. Okay.

Okay, great. There was a very, very. They're going China? No, but I think it was a Chilean. and minor family. But, you know, I would hope. How would you look at that? I mean, you're in the board meeting.

They offer you $200 billion to start the JV. You own 51% of it. Do you want to have 100 riders there and then manage that risk? And answer to the Chinese government? And then you say something out of line and you got to worry about your people. Yeah. I mean, you know, I think it's very complicated. I don't have an answer for that now.

I would hope that, you know, we're focused on English-speaking countries now. And then for a lot of the, for a lot, yeah, things like. that, for a lot of these reasons, we're focused on subscription. And subscription is, for us right now, is really focused on countries that are less of like the China demographic. Yeah, they don't even have credit card yet. So it's very different. You've got to tie in to a lot of their media companies there. We're a simple company with a simple business model. We'd rather stay in places that we can control. See, I think when you're dealing with these countries, their engagement can lead to the issue being put in the table and a slow change.

So you think about the iPhone, if the iPhone wasn't made in China, we could be in a full scale, like serious conflict with them. But because it's there and there's so much at stake, we kind of have to work it out because they need to make the iPhones and we need to buy them. Yep. And so it's very complicated. So there's an example of engagement actually leading probably net net to things getting better. Positive, yeah.

Because Tim Cook is saying, hey, you've got to treat the workers better. So it's kind of... I mean, we're going through the longest. period of peace. Globally. Yeah. And it's wonderful. Globalization is wonderful.

It is. But it's complicated. It's very complicated. You pay more than any other outlet right now. My understanding is you pay 20% more than everybody? I don't have the exact numbers. It's hard to say we... But that is a strategy.

That is an absolute strategy for us. You know, it comes back to a theme I keep talking about, which is treat your people really well. And you'll get the best people over and over. And so that's our strategy. It's just. the best people and bring on and retain the best people in the world. And we're not going to win every competition for talent, but we try to be best in class in pay, benefits, work,

environment, work, collaboration, equity. All these things add up to an environment where we hope our employees are really, really happy. Are you dead set against ever having any advertising? No, we have advertising now on our podcasts. Oh, okay, great. So podcast, you... I mean, a healthy media company in the future has multiple revenue streams. But the foundation is this. The foundation is subscription. It will always be that. You know, could we do things like events? We've had events with hundreds of or even events with thousands of people at them, right? Are they big moneymakers? No, but they're really great for our subscribers, right? And so they're really fun. I know, you know, you guys do some of that. And like, there's just such community there. And so we look into lots of other

opportunities. We have newsletters that have millions of subscribers. I know. You guys do a good job teasing the content there and reactivating. Yeah, and so we have, you learned that at Strava, didn't you? Yes, and we actually use a little bit of data science there. Explain your reactivation technique. Yeah, so we really understand what you're reading right now. And so you might say you like those four teams, but right now, you're only reading around the Knicks. And so we're constantly looking at what you're reading at right now and trying to keep that going. So think of it as a thread that we're trying to just like pull. And so we're constantly thinking about that. And we're constantly thinking about that. And We have a lot of folks focus on making sure that you open that email every day.

And it's just been an incredible way of engaging our subscribers. Yeah, that is fascinating. It turns out that wagering on sports, like gay marriage and cannabis, the entire country has flipped their position on it and the regulations have flipped in both of those cases in our lifetime. Yep. Which is kind of mind-blank. Yeah, I come from a, you know.

When were you born, 76, 77? 1980. Oh, 1980. Okay. So 10 years younger, you're 38, 39. Yep. And so I come from a Quaker town, well, like, you know, a Quaker area where, you know, you can't buy alcohol on Sundays and still.

So the idea of gambling on a gay wedding where everybody's smoking weed. Sounds amazing. Sounds amazing to me. Yeah. And here we are. How do you look at wagering because it's now going to be legal for the states to do it, two-thirds are doing it, and Adam Silver wants to move a team to Vegas and wants wagering in arena.

I personally think it's great. I think, you know, we have to obviously look at the negative externalities of it. But, you know, more money into the sports means, you know, hopefully tickets get cheaper or players, you know, we can bring on more things into the sport to make them better. So you wouldn't have a problem if a sports betting, I want it to be an advertiser or sponsor. You're totally cool. I mean, if it's legal.

100%. I mean, I don't think we have, we're not religious about it. I think it's, it's, we have to like face the environment we live in. Are we going to be a book? No. No. Of course not. No, we're a media company.

We're an objective company focused on journalism. But you could talk about the, do you talk about the lines? What are instructions to the writers when talking about the bedding part? They can do whatever they want. Do they? They can. Some are more interested than others. And if it performed.

while they can do that. But, you know, in reality, we try to, you know, provide information. Right. Right. How's Draymond looking at practice? Right. And we provide information that could be used for fantasy. It could be used for betting. It could be used just because you're a fan who cares about the outcome of a game because you love the team, right? Whatever the reasons might be. Like, I think it's going to be a net positive if it brings more people into the sport. So I'm excited. On a scale of one to Rodman, who's the most interesting in the league right now? In the NBA. Yeah. Let's talk about NBA. Because that is the phenomenon. I mean, I think it's...

I think it's Janus. You think it's Janice. Not because he's interesting personally, but because he is so... He is the mixture of everything that you would want in an athlete and a person. And he is so much better than everybody else. Yeah, and he's Greek, so that counts

for a lot for me. And there's something just like, I, like, of course like a year ago I would have said Steph Curry, he's just a joy to watch. There's nothing better than with him being hurt though, you know, it's not as fun. But Janus right now to me, I don't care for the controversy, all that stuff.

You know, there's nothing better than a player so much better than everybody else who wants to win so badly. Yeah. And he wants to get better. He doesn't care about Instagram. He doesn't care about all that stuff. Four three-point is the other night? I mean, he's just a joy to watch. Yeah.

I will, it's like Peyton versus, you know, Brady at the peak. So if you're starting a franchise today, you get to pick two players. Yeah. It's obviously the Greek freak. And Steph, that's the two you put in. It's not even close. Oh, wow. You?

It's definitely Janus. Yeah. And then number two is a challenging one because you have to decide if Steph, because we're saying today. Yeah, yeah. So Steph is a little older. Yeah. Do you just turn 30 or 31? Yeah.

So do you want to go with somebody who's 26 or 27? Who do you go right there? Yeah. And some people might say, Hawaii plus Janus, but I don't know if they can share the ball perfectly. Yeah. I mean, we, we, we, we had the story on Boardman gets paid. Like, we were the origin of that story.

That was a wonderful example of the type of work we like to do. And like him holding up the NBA trophy with that new balance shirt with Boardman gets paid. It is a big moment for our company. Yeah. You know, like we wrote that story at the biggest moment in his career, he's wearing the T-shirt. Wait, what does Boardman mean? So he gets the rebounds. Oh, got a board man.

So he used to say that. He's a, you know, he's a character. Yeah, he is. And so he would just say, board man gets paid. Boardman gets paid. He's, he's a different, different animal. What did you learn at Strava? What was the?

Yeah, the biggest learning is like really simple. Build something people want and love and they'll pay you. Wow. It's not that complicated. You just have to be focused. You can lose your focus so easily. If you build something really great that people with means take out their credit card and pay you, you have a job forever. And that's what I learned.

And we built a subscription business from scratch there. I had no idea how to do the metrics. Like that internal numbers, what are you talking? What are the KPIs? This is 2010. All right. Right. Here we go.

As we wrap up. Yep. We play the game. Uh-oh. Retweet. Yep. Like. or block or mute.

All right, let's see. What's the first tweet we got? I can't have locks for nine months, so I want to hear this kid question whether I sacrifice for SM, decent locks in San Francisco. Where? I'm in L.A. right now.

Alex says, damn, 14 ethosos have massive the brino in San Francisco. We can't get a decent bagel locks in Whitefish. It is so true. It's not wrong. There's a place with bagels in Oakland. Yeah, it happened. You've been to that place.

Yep, that's good. They're like good. Yeah, they're good. Not great. Yeah. I'm not getting on that bridge. Oh, God. What a disaster of that bridge is.

You know, it's the only place in the world where, like, the bridge shuts down because somebody ran into one of the pylons. Like, can you imagine somebody runs into the pylon or the side of the Brooklyn Bridge or Verrazana Bridge and they turn it off and they stop it? They're like, yeah, nobody's going to work tomorrow. Yeah, what are we doing? What are we doing here? That's San Francisco.

That's also San Francisco. It's a frustrating aspect of this wonderful city. Yeah, you can get a kimchi burrito. Yep. There's like, there's literally like every type of burrito you can ever imagine. You can literally get sushi rice. Yep. And Toro burrito.

They literally have that. Yep. Can't get a decent bagel. Whitefish is the thing. Come on. It's so cheap. It's so easy to make. Give me some white fish.

Yeah. Decent loss. Yeah, come on. You kill us? Yeah. Yeah. All right. East coasters.

And here's our next one. So anyway, I'm. I am retweeting that last tweet. Okay, I'll take it. Don't worry. There's no tweet. There are no career. Look at all the engagement I get on my tweets.

I know. It's incredible. Look at you. I'm a big deal. You're literally, this is why your company has. This is why your company has. We just doubled the number of retweets and increased likes by 33%. I'm shy.

This is why your company is flirting with a million subs. Because you're not wasting your goddamn time on Twitter like me. No. I will respect that is out of the first social stuff that launches the who you You should stop following module. I feel that way. You know what happened to me on the Twitter? It was the greatest thing ever.

I was getting into it with all the crazy historical libs. And I'm a libertarian, and I say that. And then they have something called blocked together. And anyway, some historical group of people were like, okay, we have to get the people we don't like on this list. And they're like, okay, we got Shapiro. Okay, we got Milo. I guess he's banned.

Okay, we got Sernovich. Okay, we got Trump. We got Trump Jr. you're, let's put Jason Calcanus on this. And I'm like, how do I get on that list? I'm not all right. Like, all day long, I'm talking about how much I hate Trump. If you're not for me or with me, you're against me?

Exactly. Like, you cannot be more. And I was like, oh, my God, my Twitter. Like, overnight became like. Same. Same because I blocked the right wing maniacs or don't follow them. And then everything on the right became like, oh, my God. Oh, no, don't do that.

Don't do that. Do not do a search for me plus deadspin because those, they don't like you they don't like me either whatever I mean here's the thing about the people Denton hired

I was in like a direct competition with Denton for many years and I crushed him and Gadget had five to ten times the traffic his motto when we were heads up

auto blog had 50 times the traffic of jalopnik and joystick had like a hundred times Kotaku so in three things

we went heads up we dominated him and I stole all those people because I paid them more and he actually gave them equity he promised them equity and paid him less my favorite tweet ever

oh this is pretty great. John Iceman. Who's that guy? He's a union guy? Is he the union leader? Hover John Eastman. He's probably verified. No, he's got 9,000. Head of audiences, social for Gizmo. Okay, so he works at Gizmodo. He's like, how's that Uber sign?

He's doing this guy's like, still $4,000 next one winning invested. Boardman gets paid. Board man gets paid. But Denton really was an innovator at the time because he said, whatever the genius of Nick Denton was you know Nick I don't

Nick had a hypocrisy radar and a fascination with hypocrisy an obsession in fact that made him one of the great publishers of all time

because he hired people his reason to Etra was to hire people who were pissed off at the man and say, he would say to them, here's hypocrisy. Go. And just find hypocrisy and call it out. And whatever people are talking about at the dinner party that they will not write,

just ask journalists what they won't write about and then we'll write about it. Interesting. Which is a double-edged sword because if you do that with the wrong billionaire and you out him, yeah, it could go in a really bad direction for him. I wouldn't do that. I wouldn't do that. There it is. I need to get that shirt.

It's a cool shirt. Sold out. Only available on stocks like Socket. For 38 bucks. Who's your team? You like the Warriors. Sixers. Sixers.

All the way. You can't change teams. Who's your number two? Warriors. Of course. They're originally from Philadelphia. Yeah. My wife is from Oakland.

It's perfect. I mean, Steph Curry. Steph Curry is just amazing. Steve Kerr? These are two of the best humans on Earth. The thing I respect most about Steve Curry is. He's like, yeah, I smoke a lot of weed. I roll the best joints.

Like, why can't my play? I don't smoke weed. And it's like, Alonzo Morning's poor liver. He was taking Motrin, like Patrick Ewing, Oakley. Those guys, they said that they would put a bowl of Motrin and Advil out in the locker room and they would eat it like M&Ms. In 10 years, we will be looking at this the way we're looking at things like we with normal people.

Yeah. And, you know, wagering. If they're insane. Absolutely insane. Their bodies are getting beat up. They have to do a pain. management and swell. I mean, let's just get Gavin Newsom on it.

He fixed the NCAA. Did he? Yeah. I mean, the California law now that, you know, there's. So wait, how did that change? Now NCAA can make money. The players can make money. That's a big deal.

What, what did that, uh, Romney was like, I'm concerned about players driving Ferraris. I'm like, hedge fund guy. Yeah. I mean, he's, they live in La Jolla. It's like, dude, you're a hedge fund guy and you're complaining about, young black men driving for a...

How out of touch are you? Like, they earn the Ferrari. And it's a Bugatti. Come on. Yeah. I mean, be legit. It's a Tesla. I mean,

Kobe's generation was Ferrari. It's not as Bugatti's. Crazy. I mean, it's very silly. How does... Do you know Bill Simmons in the ring? No, I mean, we love their work. We started around the same time.

Who do you respect most in media? Independent sports, not sports. Give me your top two, three. Who do you look at and go, killer job? Got to study them. I mean, I've been studying, you know, reading the folks at Netflix. PLEPler, I'm really excited about what he's going to do now that he's left HBO. Those are the two top of mind. What is Pepler doing now? Do he, I mean, I'm hearing things, but I have no idea. Something and something. It's not going to not work. He's too talented to not work. You know, in more of the publishing,

I mean, I'm incredibly in all of what the New York Times has been able to do. Why? What if they've been able to do that so interesting? I mean, they're just growing their subscription business. Amazing. I mean, it's hard. It's hard. Yeah.

And they've pivoted. How many companies can take something that complicated and old and turn it around. Yeah. So I look at them as a beacon of for others to say, you know what? Paywall. Washington Post. Wall Street Journal, New York Times, all double-tripled their subscribers in the last five, ten years. And that's all they needed to do this whole time.

Yeah. And yes, their other revenue is shrinking very quickly, but they'll figure it out. And I'm really encouraged by that. And obviously, you know, the other pioneers and what we're doing, like, you know, just lost in at the information. It's not simple. It's hard. It's hard.

You know, the business of fashion, if you don't know this business. I do. I've heard of this one. Yeah, more of a trade pub. but incredible product. Can you build a great brand with a great business and in media?

One of my riders who worked at Silicon Airport I went on and did Skift, I don't know if you're going to Raffet Ali. So he was one of my original. Yeah, a trade pub that, that focus,

they got profitable. They didn't overcapitalize, right? Figured it out. Yeah, my three riders, four riders. What's that? Zach Lowe is the guy

that I read that it's outside the athletic. He writes for ESPN. ESPN. Yeah. You can't get him? Bill Barnwell, others. Can't get Zach low?

It's tough. What do they do? Like four or five-year contracts? A really tough competitor. Why? Why they're so tough? Because they can put you on air? Yeah, they have a TV station. They have reach. But you're starting to do video. Yeah. We're figuring it out. You know, we don't have a television station. We don't have a cable network. Look, I mean, I'm here in a studio. It costs $150,000 to build a world-class studio that looks as good as ESPN. And you have 500 writers. Why don't you just put up eight hours a day of coverage?

It will cost you $1,000 an hour. It'll cost you $1,000 an hour because you already have the talent. They just come on and shoot the ship. Someday we might do that. All right. Listen. This is awesome. You did a great job on the pod.

Thanks. Great job on the business. Thank you. And everybody who's listening, if you're a great writer, I'm sure Alex at the Athletic Works. Yeah. And if you want to start a media company, put up a paywall. Put up a paywall. It's that simple.

You know what? I've been doing inside.com and I tried to do both. And we made so much in advertising. we immediately got to $2 million in advertising. And now I'm like rethinking the whole thing. Well, that's the thing is the first $5 million, $10 million in advertising. I know. It is easy.

It's really hard to sustain. And so now I'm trying to figure that out. Also, you know, I may have made a critical mistake because I went freelancers. Because two years ago I was like, there's more freelancers passionate who just want a third of a time job. So why don't we just give people 25K to do one newsletter for three or four hours a day? And they can do whatever they want. That's wonderful, yeah. And then while I'm doing that for the last few years, the entire media collapses.

And now everybody is saying, full time, full time. Please let me be full time and I'll write three newsletters. And I'm like, okay, I think I made a critical error. Or the market change. It's not simple. You need a balance. We have a lot of freelancers too who want that life balance, right? Yeah, but the full-time people, they produce three times as much.

So you have to manage one relationship. You get three times the output. Yep. As opposed to dealing with three personalities doing one third, which then creates management overhead. It's hard. My management overhead right now. Now it's making it crazy.

Yeah, managing is really hard. You do your own podcast? You're doing it with Wondry. We have one podcast with Wondry called The Lead. Listen, it's free. It's an Apple podcast. Oh, they were charging. No, it's Apple Podcasts.

Oh, okay, cool. And then we have about 150 other podcasts for teams. Got it. So, you know, we're going to launch others soon. And like, you know, we think about if you're a team, a fan of the Nix, long term, we want to create the best Nix podcast. Yeah. And that'll be valuable to you.

I love that there's like these crazy Nick fans now, and they're doing super cuts of the game that are better than what MSG provides. And I'm like, MSG, I used to go to MSG to watch the recaps because they have the condensed version. Yeah, exactly, the condensed games. And the condensed game, not as good as the editing skills of people doing it for free on the goddamn New York Knicks Film School at NYK Film School. This kid is amazing. And, yeah, what do you think of Nick? Do you like RJ?

I think the Knicks. No, let's talk players. RJ. Amazing. This kid might be better than Zion. He's amazing. Wow. Zion doesn't play the game yet.

Let me tell you, I was talking to one of the top five players in the league. Okay. And I said to one of the top players in league, Zion RJ, how should I feel as a Knicks fan? He said Zion has more upside. Yep. But he's not going to be able to stay on the court at 285 pounds. It's a big boy. RJ has less upside.

This top five player in the league, and I said top five because I don't want to say top one or two, said the top, that RJ is the safer bet and will likely have a much better career and will be the number one player on whatever team he's on. And I don't know if you've watched him. I have.

In this season, he's a bit, he's a man. Yep. I don't know how old is he. Is he 19 or 20? I think he's 20. He's 20. And he is playing like. a man. Yeah, no, he's going to be, I think you've got a good one. I'm excited for...

And the poor Zingish trade is the worst trade in the history of the NBA? I cannot... I cannot imagine a scenario in which you would trade someone like Christops. I have no idea why you would want to trade someone like him. I literally almost puked when I saw it on Twitter trending. I literally, it's a good friend of mine. I hate you, Mark, for that. but I'm literally almost puked then I almost cried and then I almost The stages of a Knicks fan

I literally felt I physically felt like I was going to vomit then I got so emotional I had to be alone and you got angry didn't you and then I got so angry that I decided I am committing Nick Sapuku this year

I'm going to end on this this is what I'm doing I'm going to the Knicks game this year uh oh going to get a nice court side seat for a nationally televised game. Like I had for the finals game, I had the seat next to the bench of the, of the, who do we play, the Raptors?

Raptors. I had the Raptors bench. And I'm literally the coach and me next to each other in the first row. So I'm going to get that seat next to the Knicks, the other side. And I'm going to take my jacket off during the commercial break or whatever, timeout. and it's going to just say, sell the Nix. And I think that might get him over the line. I'm going to refuse.

I think it's going to get them over the line. And they will have to throw me out for wearing that because Doling can't handle it. And I'm not going to allow myself to be taken out if I paid $15,000 or $5,000 for that seat. So they're going to have to drag me out for wearing a T-shirt. And then I will be banned for Madison's Work Garden for Life and I can get off of this Nix addiction. Like I have a friend, not a friend. I know somebody who is a degenerate gambler. He used to play cards.

Okay. And he stopped playing in the game. And I said, what happened? He said, I stiffed the game for $40,000. I said, what? He said, I had an addiction. I had to never get invited back. I had lost like a million dollars in the game.

I didn't pay the last 40. They'll never invite me back. If I pay the 40, that I'm going to be playing every week. And you'll, you can become a six. All right. We'll see you all next time on this week's stars. Bye, bye.